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The reinstatement of policies falls through the cracks

In 2014, Elenoa took out life ($400,000) and trauma ($100,000) insurance policies through an online broker. In 2020, Elenoa had some difficulties paying her monthly premiums and her policies were cancelled in June 2020.

Elenoa then corresponded with the broker and asked how her policies could be reinstated. Eventually, on 17 September 2020, she emailed the broker and said she could not afford the premiums, so wouldn’t reinstate the policies.

Unfortunately, the broker did not update their online portal to note the policies as ‘cancelled’ or lock Elenoa out of the portal (seeing she no longer had active policies).

Elenoa said that at some point after 17 September 2020, she called the broker to reinstate her policies. She said she also logged into the portal several times over the next few years and updated her contact details, and saw her policies noted as being ‘current’. She also received marketing emails and newsletters from the broker.

In May 2022, Elenoa was diagnosed with a brain tumour, requiring surgery. Her surgeon said she’d be off work for at least 6 weeks post-surgery. Elenoa contacted the broker to ask whether she still had life and trauma policies in place. It then came to light that the policies had been cancelled back in 2020. Elenoa was devastated to find this out at the same time as being diagnosed with a brain tumour. She was extremely stressed.

The broker contacted the insurer to ask whether they would reinstate the policies, but the insurer said they wouldn’t.

After being unable to resolve the issue directly with the broker, Elenoa brought her complaint to FSCL.


Elenoa said the broker was responsible for her not having life and trauma policies in place. She was sure she had contacted the broker after 17 September 2020 to reinstate her policies, and she said she was misled that her policies were current because this is what it said on the online portal. Elenoa said she had missed paying her annual premium in 2021, which was easy to do with an annual payment, compared to a monthly payment.

The broker acknowledged the error in not updating the portal. However, they did not consider they were responsible for Elenoa not having the policies in place. They said there was no record of Elenoa asking for her policies to be reinstated after 17 September 2020.

The broker also said the evidence suggested that Elenoa knew her policies had not been reinstated. This was particularly because Elenoa seemed unsure about the status of her policies when she asked the broker whether she still had policies in place (after she was diagnosed with the tumour). The broker also pointed out that, in fact, Elenoa had been paying her premiums, prior to 2020, on a monthly basis, not an annual basis.


Firstly, we looked at whether Elenoa’s trauma policy would likely have responded to a claim about her brain tumour if the policy had been in place. It appeared it would have.

Financial loss

We considered there was not enough evidence that the broker’s omitting to remove Elenoa’s access to the portal or to update the status of the policies to ‘cancelled’, had caused Elenoa not to have the policies in place. This was because there was no documentary evidence to support that Elenoa had contacted the broker or the insurer, after 17 September 2020, to reinstate the policies.

We could appreciate that Elenoa was sure in her recollection that she had made that contact, but her evidence was less persuasive than the broker’s. The broker’s records were very thorough, so if Elenoa had asked for the policies to be reinstated, we thought there would have been a record of it. We said it was more likely than not that Elenoa did not contact the broker or the insurer to reinstate her policies and this was the reason she had no trauma cover in place.

Loss of opportunity – non-financial loss

However, we did consider that the broker had caused some non-financial loss to Elenoa. Essentially, this was because both parties had contributed to Elenoa losing the opportunity to reinstate the policies.

The broker had not updated the policy status on the portal, had not locked Elenoa out of the portal, and had continued to send her communications indicating her policies were in place. However, against this, Elenoa had been previously paying her premiums monthly (not annually), meaning she could have noticed she was not paying for the policies after September 2020, and questioned this.

We acknowledged that Elenoa’s May 2022 question to the broker about whether her policies were in place seemed to indicate she was unsure whether her policies were current. However, against this, Elenoa had logged into the portal several times and updated her details after September 2020, indicating she thought she had reinstated her policies.

Also, although it appeared Elenoa could have reinstated her policies before she was diagnosed with the brain tumour, it was less clear that she could have afforded to reinstate. 

Overall, we considered the broker’s error in not updating the policy status on the portal/locking her out, caused Elenoa stress at a very high level. She discovered the error at the same time as she was diagnosed with a brain tumour, and this was very distressing. This was coupled with the fact that her tumour and surgery meant it would be extremely difficult and possibly cost-prohibitive for her to obtain life and trauma policies again the future.

We suggested that the broker pay Elenoa the maximum amount that can be awarded under FSCL’s rules for non-financial loss ($5,000).


The parties accepted our suggested resolution, and the complaint was resolved.

Insights for consumers or participants

This case was a really unfortunate example of a consumer’s mistake in not keeping their insurance policy premium payments, and records of their insurance, up to date. In Elenoa’s case it appeared this was simply something that fell through the cracks, with devastating consequences for her. Likewise, a simple error from the broker contributed to the stress Elenoa suffered.

This case also highlights the importance of good record keeping. It was because the broker’s records were so thorough that we preferred their position that Elenoa had not made contact to reinstate her policies.